What Is the “Price-Time Priority” Rule in Order Matching and How Does It Deter Front-Running?

The price-time priority rule is the standard algorithm used by centralized exchanges to match orders. It dictates that orders are filled first by the best price (highest bid, lowest ask).

If multiple orders share the same best price, the order that was submitted earliest (first in time) is filled first. This strict, objective rule prevents an exchange or its employees from manually inserting a new order ahead of an older one at the same price, which is the core mechanism of active front-running.